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Major tenant to anchor Esko Business Park

This diagram shows the lots in the Esko Light Industrial/Commercial Business Park being purchased by Coates RV Center (shaded) for its new northern Minnesota facility. Contributed by Carlton County Economic Development

It was possibly the best-kept secret ever, but when Carlton County Commissioners approved an economic development loan Tuesday in support of a major new retailer in the Esko Light Industrial/Commercial Business Park, the cat was out of the bag.

Coates RV Center, with current operations in Hugo, Minn., and Williston, N.D., recently signed a purchase agreement for approximately 15 acres in the Esko park with an eye toward constructing “a very significant” facility there, according to Coates co-owner Mark Pettersen.

County Economic Development Director Connie Christenson requested that commissioners enter into a $145,000 loan agreement with Coates to aid in the purchase of the property, with the company using cash reserves for the balance of the purchase price. Christenson explained that the negotiated terms include a one-year note with interest-only payments, and the county would have the first position secured lien on the property.

Commissioners followed the lead of the county Economic Development Authority in giving the loan — and the project itself — their unqualified endorsement.

“This is a good move,” state Commissioner Bob Olean. “I really like the looks of this project.”

Board Chair Dick Brenner concurred.

“This is a very big deal,” said Brenner. “This will really open up that park and get the ball rolling.”

Coates RV is a fourth-generation large recreational vehicle dealer, one of the largest of its kind in the Midwest, carrying a complete line of Forest River travel trailers, fifth-wheels, park models, tent campers and “toy haulers.” Pettersen said the company has been in business since 1938, originally operating out of St. Paul before moving to the Hugo/Forest Lake area 10 years ago and adding another facility in Williston three years ago.

“We have a tremendous facility in the Cities (located along I-35),” said Pettersen, “and we believe Esko offers similar exposure.”

Pettersen said there had been "a lot of interest" from the company's northern Minnesota customers, as well as those in Canada and Wisconsin, and the company felt this would be a good area to expand its interests. He said he owns a home on Crane Lake and often comes through this area of the state on his way to the lake.

The company began taking a more serious look at the possibilities just after the first of this year, and with the help of Christenson and the Thomson Township Board, they were able to narrow their search to the Esko Light Industrial/Commercial Business Park. The 58.92-acre park, which was started with the help of state and county grants and completed in 2009, features 36 lots and abuts Highway 61 and I-35.

"We were humbled that they wanted to place their trust in our community," commented Thomson Town Board Chair Terry Hill. "This is a huge deal, a big project."

To date, the park has only one other tenant — the Superior Fuel Bulk Storage facility. Hill said the economic downturn hit shortly after the park was completed, so interest and activity stalled out for a time, but he sees this latest move as one that will jump start the business park and take it to the next level.

"This is going to be a significant win for the entire area," he stated.

Plans for the new Coates RV Center are already well underway, and Pettersen said he will be meeting with the architect this Saturday.

"We plan on building a facility that is as nice as, or surpasses, the one we have in the Cities," he said. "It should have very good curb appeal."

Pettersen, who is part of the company's leadership group that includes Sarah and Jesse Lange of Lange General Contracting, said the company expects to close on the deal with Thomson Township in July and break ground in the business park location just after the first of next year, with an eye toward opening the new facility later that spring.

He said the new 35,000-40,000 square foot building will feature indoor showroom space, 10 service bays and a parts and accessories department.

"There's not really another readily accessible RV accessories and parts store in this area," he said. "This will be a first-class facility."

The new Coates RV Center in Esko is expected to eventually employ 30-35 people, including general labor, repair service technicians, sales consultants, finance and business operations and management.

Pettersen said the company has a history of supporting local events in the areas where they do business, adding they are planning a festive kickoff event in July for community members, the media and local officials.

"We are proud to be moving to the Esko area," commented Pettersen.

Hill said the feeling is mutual.

"It's one of those things where you have to keep pinching yourself to convince yourself it's real!" he said.